US data center M&A hit a five-year high, driven by a surge in private equity investment, according to S&P Global Market Intelligence. The firm's May 2026 analysis attributes the jump to AI-driven demand for compute capacity, with sponsors and infrastructure funds directing billions into digital infrastructure assets that a decade ago would have been considered a niche real estate subsector.

The scale of individual transactions this year illustrates why. In late June, Digital Realty agreed to buy a larger stake in three Northern Virginia data centers from Blackstone for $3.5 billion, a deal that values the underlying assets at $7.8 billion. Northern Virginia remains the largest data center market in the world by leased capacity, and the pricing on this transaction gives the sector one of its clearest recent marks for hyperscale-adjacent colocation assets in "Data Center Alley."

That deal followed Bain Capital's move in April to shop at least a 40% stake in Bridge Data Centres, a Singapore-headquartered operator with a footprint across Asia-Pacific, at a $5 billion valuation, according to Reuters. Sponsors that built positions in digital infrastructure during the platform-aggregation wave of the early 2020s are now testing exit valuations against a buyer pool that includes strategic operators, sovereign wealth funds, and rival PE shops all competing for the same pipeline of powered land and interconnection assets.

The sell-side activity is not confined to Western markets. Bloomberg reported in February that PT Telkom Indonesia is reviving plans to sell a stake in its data center unit, seeking to monetize rising investor appetite for Southeast Asian digital infrastructure. Around the same time, Bloomberg reported that Singapore's GIC is weighing a sale of its 80% stake in a European data center joint venture, in a deal that could value the business at up to $1 billion. GIC's position as both a prolific buyer and now a prospective seller of data center equity captures the two-sided nature of the current cycle: capital that entered early is beginning to look for liquidity events even as fresh capital keeps arriving behind it.

That fresh capital has arrived in scale. Vantage Data Centers closed a $6.4 billion equity investment round led by DigitalBridge and Silver Lake, funding that will underwrite further hyperscale campus development against long-dated power and land commitments. Apollo-managed funds separately agreed to acquire a majority stake in Stream Data Centers, extending the credit-and-equity giant's push into an asset class it has increasingly treated as a core private markets allocation rather than an opportunistic sleeve.

Several threads run through these transactions. Buyers are underwriting deals on the assumption that AI training and inference workloads will sustain multi-year demand for power-dense colocation space, even as questions persist about the pace of enterprise AI monetization relative to the capital being deployed to build the infrastructure underneath it. Sellers, meanwhile, are capitalizing on valuations that have re-rated sharply from where similar assets traded five years ago, when data centers were priced closer to conventional net-lease real estate than to infrastructure with embedded optionality on compute scarcity.

The financing structure of these deals also merits attention. Much of the recent activity, including the Digital Realty-Blackstone transaction and the Vantage round, involves large minority-stake sales or partial monetizations rather than outright change-of-control sales. That structure lets existing owners crystallize valuation gains while retaining operational control and upside exposure, and it lets incoming capital — much of it from infrastructure funds with long duration liabilities — gain exposure to AI-adjacent real assets without taking on full development and leasing risk. It is a financing pattern more typical of core-plus infrastructure than of traditional PE buyouts, and it reflects how thoroughly data centers have migrated into institutional infrastructure allocations over the past several years.

Power availability, not capital, looks like the binding constraint on how much further this deal volume can run. Every transaction referenced here sits atop a pipeline of grid interconnection queues, on-site generation arrangements, and land banking that determines how quickly new capacity can actually be delivered. Valuations premised on AI-driven demand assume that power gets solved at a pace matching hyperscaler capex plans; if utility interconnection timelines slip further, the gap between capital committed and megawatts deliverable could widen, putting pressure on the multiples underwriting deals like the Bridge Data Centres sale process. For now, though, the deal count and dollar volumes speak for themselves, and S&P Global's five-year-high reading suggests sponsors are still finding willing capital on both sides of the table.